Replevin jurisprudence.doc

8/14/2019 Replevin jurisprudence.doc

http://slidepdf.com/reader/full/replevin-jurisprudencedoc 1/22

Republic of the PhilippinesSUPREME COURT

Manila

EN BANC

G.R. No. L-17393 July 21, 1921

BACHRACH MOTOR COMPANY, INC., plaintiff,

vs.RICARO SUMMERS, defendant.

Gibbs, McDonough and Johnson and Benedicto M. Javier for plaintiff.Claro M. Recto and Jose M. Casal for defendant.

STREET, J.:

On March 9, 19!, Elias Aboiti" e#ecuted a chattel $ort%a%e upon a Nash auto$obile, bearin% the &actor' No.1()*(), in favor of the Bachrach Motor Co$pan', +nc., to secure a debt for P),*-, pa'able in telve install$ents. +n

the $onth of Nove$ber of the sa$e 'ear, the $ort%a%or defaulted in the pa'$ent of the install$ent for that $onth/and as a conse0uence the Motor Co$pan' deter$ined to have the car sold for the purpose of foreclosin% the$ort%a%e, in the $anner prescribed in section 1( of the Chattel Mort%a%e a 2Act No. 1-!34. +t accordin%l're0uested Ricardo 5u$$ers, as sheriff of the cit' of Manila, to ta6e the car fro$ the debtor and to e#pose it to public

sale, as provided in said section. Actin% in pursuance of this authorit' the sheriff applied to the $ort%a%or for theauto$obile/ but the $ort%a%or refused to surrender possession/ and the Motor Co$pan' instituted an action of

replevin to recover the car. 7oever, its effort to %et possession ere a%ain destined to be te$poraril' baffled, asAboiti" %ave bond for the retention of the auto$obile pendente lite. 8he Motor Co$pan' thereupon filed the presentpetition in this court for the rit of mandamus to co$pel the sheriff to sei"e the car fro$ the $ort%a%or and sell it. 8othis petition the sheriff de$urred, and the cause is no before us for the deter$ination of the issues thus presented.

8he 0uestion to hich e shall first address ourselves and hich is reall' the vital point in the case is hether,

after default b' the $ort%a%or in the perfor$ance of the conditions of a chattel $ort%a%e, the sheriff isunconditionall' bound to sei"e the $ort%a%ed propert', at the instance of the creditor, and sell it to satisf' the debt.8he petitioner supposes that the sheriff $ust so proceed and that, upon failure to do so, he can be co$pelled theretob' the rit of mandamus.

+n co$$ercial usa%e the propert' hich is the sub:ect of a chattel $ort%a%e is, as ell 6non, al$ost invariabl' left

in the possession of the $ort%a%or, and this possession is not disturbed until the $ort%a%or defaults in the pa'$ent ofthe secured debt or otherise fails to co$pl' ith the condition of the $ort%a%e.

;hen default occurs and the creditor desires to foreclose, he $ust necessaril' ta6e the $ort%a%ed propert' into hishands/ and his ri%ht to do this is clearl' i$plied in the provision hich %ives the ri%ht to sell. 5a's the statue< =8he

$ort%a%ee . . . $a', after thirt' da's fro$ the ti$e of condition bro6en, cause the $ort%a%ed propert', or an' partthereof, to be sold at public auction b' a public officer at a public place in the $unicipalit' here the $ort%a%orresides,= etc. 25ec. 1(, Act No. 1-!3.4 As ill be seen, this provision supposes that the creditor has possession of the$ort%a%ed propert', for the poer to sell i$ports a poer to $a6e deliver' of the thin% sold to the purchaser/ andithout actual possession deliver' ould be i$possible. 8he ri%ht of the $ort%a%ee to have possession after conditionbro6en $ust therefore be ta6en to be un0uestionable/ and to this effect is the %reat ei%ht of A$erican authorit'. 211

C.>., -*!/ 3 A$. and En%. Enc'c. of a, d ed., 3/ - R.C., (*/ 5t. Mar'?s Machine Co. vs. National 5uppl' Co.,9* A$. 5t. Rep., *, *3(, note.4

;here, hoever, the debtor refuses to 'ield up the propert', the creditor $ust institute an action, either to effect a :udicial foreclosure directl', or to secure possession as a preli$inar' to the sale conte$plated in the provision above0uoted. 7e cannot lafull' ta6e the propert' b' force a%ainst the ill of the debtor. @pon this point the A$erican

authorities are even $ore har$onious than the' are upon the point that the creditor is entitled to possession. As assaid $an' 'ears a%o b' the riter of this opinion in a $ono%raphic article contributed to an enc'clopedic le%altreatise, =if possession cannot be peaceabl' obtained the $ort%a%ee $ust brin% an action.= 28rust eeds and Poer of5ale Mort%a%es, 3 A$. and En%. Enc'c. of a, d ed., 3).4 +n the article on Chattel Mort%a%es, in Corpus >uris,e find the folloin% state$ent of the la on the sa$e point< =8he onl' restriction on the $ode b' hich the$ort%a%ee shall secure possession of the $ort%a%ed propert' after breach of condition is that he $ust act in an orderl'



$anner and ithout creatin% a breach of the peace, sub:ectin% hi$self to an action for trespass.= 211 C.>., -*!/ seealso - R.C.., (*.4

8he reason h' the la does not allo the creditor to possess hi$self of the $ort%a%ed propert' ith violence anda%ainst the ill of the debtor is to be found in the fact that the creditor?s ri%ht of possession is conditioned upon thefact of default, and the e#istence of this fact $a' naturall' be the sub:ect of controvers'. 8he debtor, for instance, $a'clai$ in %ood faith, and ri%htl' or ron%l', that the debt is paid, or that for so$e other reason the alle%ed default isnone#istent. 7is possession in this situation is as full' entitled to protection as that of an' other person, and in the

lan%ua%e of article ((* of the Civil Code he $ust be respected therein. 8o allo the creditor to sei"e the propert'a%ainst the ill of the debtor ould $a6e the for$er to a certain e#tent both :ud%e and e#ecutioner in his on cause

a thin% hich is inad$issible in the absence of une0uivocal a%ree$ent in the contract itself or e#press provision tothat effect in the statute.

+t ill be observed that the la places the responsibilit' of conductin% the sale upon =a public officer/= and it $i%ht be

supposed that an officer, such as the sheriff, can sei"e the propert' here the creditor could not. 8his su%%estion is, ethin6, ithout force, as it is $anifest that the sheriff or other officer proceedin% under the authorit' of the lan%ua%ealread' 0uoted fro$ section 1( of the Chattel Mort%a%e a, beco$es pro hac vice the $ere a%ent of the creditor.8here is nothin% in this provision hich creates a specific dut' on the part of the officer to sei"e the $ort%a%edpropert'/ and no intention on the part of the la$a6in% bod' to i$pose such a dut' can be i$plied. 8he conclusion isclear that for the recover' of possession, here the ri%ht is disputed, the creditor $ust proceed alon% the usual

channels b' action in court. ;hether the sheriff, upon bein% inde$nified b' the creditor, could safel' proceed to ta6e

the propert' fro$ the debtor, is a point upon hich e e#press no opinion.

+n the brief of counsel attention is directed to the circu$stance that in section ) of Act No. 1-!3, the chattel $ort%a%eis said to be a conditional sale/ and an inference is dran therefro$ supposedl' favorable to the contention of thepetitioner. +t is undeniable that the lan%ua%e there used supports the vie that the $ort%a%ee is the oner of the

$ort%a%ed propert' and therefore entitled to possession after condition bro6en, but that provision is in no iseconcerned ith the proble$ as to ho possession $a' be ac0uired if the $ort%a%or refuses to 'ield it up. +n thisconnection a fe ords of co$$ent e#hibitin% the true i$port of that provision ill not be out of place. 8he lan%ua%ereferred to is as follos<

5ec. ). A chattel $ort%a%e is a conditional sale of personal propert' as securit' for the pa'$ent of a debt, or

the perfor$ance of so$e other obli%ation specified therein, the condition bein% that the sale shall be voidupon the seller pa'in% to the purchaser a su$ of $one' or doin% so$e other act na$ed. +f the condition isperfor$ed accordin% to its ter$s the $ort%a%e and sale i$$ediatel' beco$e void, and the $ort%a%ee is

thereb' divested of its title.

8he use of the ter$ conditional sale in connection ith the chattel $ort%a%e is apt to be $isleadin% to a personunac0uainted ith the co$$onla histor' of the contract of $ort%a%e/ and it is unfortunate that such an e#pressionshould have been incorporated in a statute intended to operate in the Philippine +slands. As ill be readil' seen, theidea is totall' forei%n to the conception of the $ort%a%e hich is entertained b' the civil la. ;hat is orse it doesnot even reflect ith fidelit' the actual state of the A$erican and En%lish la on the sa$e sub:ect.

Ri%htl' understood, in connection ith the co$$onla histor' of the $ort%a%e, the $eanin% of the section 0uoted$a' be e#hibited in so$e such proposition as the folloin%<

A chattel $ort%a%e is a contract hich purports to be, and in form is, a sale of personal propert', intended as securit'for the pa'$ent of a debt, or the perfor$ance of so$e other obli%ation specified therein, upon the conditionsubse0uent that such sale shall be void upon pa'$ent of the debt or perfor$ance of the specified obli%ation accordin%

to the ter$s of the contract.

No, hile the proposition hich e have here for$ulated contains a true description of the e#ternal features of thechattel $ort%a%e, it does not b' an' $eans e$bod' a correct state$ent of its :udicial effects. A visit to an' recorder?soffice in a co$$onla 5tate ill suppl' abundant proof that chattel $ort%a%es are co$$onl' dran in the for$ of a

strai%ht sale, to hich a clause of defeasance is added, declarin% that in case the debt is paid or other obli%ationperfor$ed the contract ill be void. But the for$ of the contract is $erel' a herita%e fro$ the re$ote past, and doesnot be an' $eans reveal the e#act i$port of the transaction. Ever' person, hoever superficiall' versed in A$ericanand En%lish la, 6nos that in e0uit' the $ort%a%e, hoever dran, is to be treated as a $ere securit'. 8he contract infact $erel' i$poses on the $ort%a%ed propert' a subsidiar' obli%ation b' hich it is bound for the debt or otherprincipal obli%ation of the $ort%a%or. 8his is the e0uitable conception of the $ort%a%e/ and ever since the En%lish



Court of Chancer' attained to supre$ac' in this depart$ent of :urisprudence, $ort%a%es have been dealt ith in thissense in ever' land here En%lish la has ta6en root. 8he old for$ulas $a', it is true, re$ain, but a ne spirit hasbeen breathed into the$. And of course sooner or later the ancient for$s are discarded. oo6, for instance, at the for$

of a chattel $ort%a%e %iven in section - of Act No. 1-!3, here it is said that the $ort%a%or =conve's and $ort%a%es.=8his $eans =conve's b' a' of $ort%a%e/= and the ord =$ort%a%es= alone ould of course be e0uall' effective. +nfact e note that in the contract e#ecuted in the present case, it is $erel' said that Elias Aboiti" =$ort%a%es= theauto$obiles to hich the contract relates. +n describin% the chattel $ort%a%e as a conditional sale e are $erel'

rattlin% the bones of an anti0uated s6eleton fro$ hich all se$blance of ani$ate life has lon% since departed. 8heauthor of 5ection ) of the Chattel Mort%a%e a as $ost unhapp' in his effort to elucidate to civilian :urists the

A$erican conception of the contract of $ort%a%e.

But hatever conclusion $a' be dran in the pre$ises ith respect to the true nature of a chattel $ort%a%e, the result$ust in this case be the sa$e/ for hether the $ort%a%ee beco$es the real oner of the $ort%a%ed propert' asso$e suppose or ac0uires onl' certain ri%hts therein, it is none the less clear that he has after default the ri%ht ofpossession/ thou%h it cannot be ad$itted that he $a' ta6e the la into his on hands and rest the propert' violentl'

fro$ the possession of the $ort%a%or. Neither can he do throu%h the $ediu$ of a public officer that hich he cannotdirectl' do hi$self. 8he conse0uence is that in such case the creditor $ust either resort to a civil action to recoverpossession as a preli$inar' to a sale, or preferabl' he $a' brin% an action to obtain a :udicial foreclosure inconfor$it', so far as practicable, ith the provisions of the Chattel Mort%a%e a.

Onl' a fe ords ill be added ith reference to the 0uestion hether this court has :urisdiction to entertain the

present proceedin%. +n this connection it is insisted b' the attorne's for the respondent that the sheriff is an officer ofthe Court of &irst +nstance and the petitioner should, so it is insisted, address hi$self to that court as the proper courtto control the activities of the sheriff. ;hile this criticis$ ould be valid if the purpose ere to control the sheriff inthe $atter of carr'in% into effect an' :ud%$ent, order, or rit of a Court of &irst +nstance, it is not applicable in a caseli6e the present here the act to be done is defined b' %eneral la and has no relation to the office of sheriff as the

e#ecutive officer of the Court of &irst +nstance. As to such activities this court $ust be considered to have concurrent :urisdiction ith the Court of &irst +nstance under section -1- of the Code of Civil Procedure.

8he de$urrer $ust be sustained, and the rit pra'ed for ill be denied. +t is so ordered, ith costs a%ainst thepetitioner.

Mapa, C.J., Araullo, Avancea and !illamor, JJ., concur.




Manila

EN BANC

G.R. No. L-29!92 "#$%u&%y 29, 1972

BATAAN HAR'OO CORPORATION, ET AL., petitioners,

vs.Y PAC ( CO., INC. &)* COURT O" APPEALS, respondents.

"eli# $. Acenas for petitioners.

"eliberto !. Castillo and %emaco &. %acmar for private respondent.

TEEHAN+EE, J.: p

Appeal b' certiorari fro$ a decision of the Court of Appeals.

8he undisputed facts of the case, as found b' the appellate court in its decision and as reproduced b' petitioners in

their petition at bar, are as follos< .

On >anuar' 1, 19*!, plaintiffappellant ' Pac Co$pan' and defendantappellee Bataan7ardood Corporation, both dul' or%ani"ed Philippine Corporations, entered into a contract hereb'

appellant ould advance appellee certain su$s of $one' for lo%s hich the latter ould sell to thefor$er. +n the course of their business dealin%s, appellee beca$e indebted to appellant for the a$ountof P1,!!!.!!. 8his fact is confir$ed in a subse0uent contract entered into b' the sa$e parties on>ul' *, 19*! supersedin% their for$er a%ree$ent 2E#h. A4, and settin% forth the $anner of pa'$entb' appellee co$pan' of said obli%ation, thus<

8hat the 5EER 2appellee corporation4 ill pa' the B@DER 2appellant co$pan'4 the su$ ofP1,!!!.!! interest at 1 per $onth be%innin% >ul' 1, 19*! in $anner folloin%<

a4 P1,-!!.!! per $onth, the sa$e to be pa'able at the rate of P-!.!! ever' 1-th da' of the $onth,

and P-!.!! ever' )!th da' of the $onth, the sa$e to be%in >ul' 1-, 19*!, ith the understandin%that the said pa'$ents be applied to the pa'$ent of the a$ount due and herein above confir$ed

includin% interest, said pa'$ents to continue up to ece$ber )!, 19*!/ .

b4 Be%innin% >anuar' 9, 19*1, the 5EER a%rees to li0uidate the balance of said obli%ation hereinabove stated as ell as an' and all advances that $a' hereinafter be %ranted at the rate of P1,!!!.!!per ee6, be%innin% &ebruar' 9, 19*1 and ee6l' thereafter, the sa$e to be deducted fro$ the

purchase price of the lo%s to be sold b' 5EER to the B@DER, in accordance ith the ter$s andconditions hereinabove specified, and until the a$ount, includin% such other advances as the5EER $a' hereinafter receive shall have been full' paid/? 2Appellant?s Record on Appeal, p. 4 .

+n said contract E#hibit A, it further appears that as securit' for the obli%ation, appellee corporationand Mauro B. Fan"on $ort%a%ed in favor of appellant a vessel called =Bat$an e# C8 13,=

described in their contract as re%istered in the na$e of said Mauro B. Fan"on/ that the other appellee,o$in%o B. 5anche", stipulated that said $ort%a%e should be superior to another $ort%a%epreviousl' constituted on the vessel in his on favor/ that appellee corporation undertoo6 to insuresaid vessel for at least P)!,!!!.!! in favor of appellant/ that in the event of default b' appelleecorporation ith respect to an' of the ter$s and conditions of the contract, appellant had the ri%ht todeclare the contract ter$inated and the hole standin% balance on the obli%ation ould auto$aticall'

beco$e due/ that upon the e#piration of five da's folloin% de$and of the obli%ation b' appellant,appellee ould pa' a penalt' of P1!!.!! for each da' of dela'/ and that finall', should appellantforeclose the $ort%a%e :udiciall' or e#tra:udiciall', =the penalt' shall be included and added to theprincipal a$ount due plus an additional - of the full a$ount due hich the parties a%ree to besecured.= .



espite the contract, appellee co$pan' failed to insure the vessel and as, $oreover, irre%ular in thepa'$ent of the stipulated install$ents and interest due on its principal obli%ation, pro$ptin%appellant to send letters of de$and 2E#hs. , E &4. B' October 19, 19*!, appellee paid onl' the

install$ents due as of Au%ust 1-, 19*! in the a$ount of P,-!.!! 2E#hs. 1, 1A 1B4. ;ithrespect to the stipulated interest, appellee si$ilarl' paid onl' up to Au%ust 1-, 19*! 2E#hs. , A B4. On Nove$ber (, 19*!, appellant rote appellee co$pan' a final letter of de$and infor$in%the latter partl' as follos< .

G8e#t of de$and letter o$itted.H 1

Appellee?s $ere response to the above letter as the pa'$ent of to additional install$ents in thea$ount of P1,-!!.!!, hich as, hoever, dul' accepted b' appellant co$pan' 2E#hs. 1C4. But upto the present ti$e, appellee has not paid its balance ith appellant in the a$ount of P1,-!.!!/ andon account of appellee?s failure to insure the vessel as a%reed upon, appellant co$pan' itself secured

the necessar' insurance spendin% for pre$iu$s and docu$entar' sta$ps, the total su$ of P,1)1.-*2E#hs. C, C1 C4. On Au%ust 3, 19*1, plaintiffappellant as aforesaid, filed the presentco$plaint.

Private respondent?s verified co$plaint in the Court of &irst +nstance of Manila set forth three causesof action, and it pra'ed for :ud%$ent as follos< .

;7ERE&ORE, it is respectfull' pra'ed that upon approval of the plaintiff?s bond, an order be issued

directl' to the 5heriff of Manila, or an' officer of the court, to ta6e possession of the abovedescribedvessel for the deliver' of the sa$e to plaintiff, and that :ud%$ent be rendered in favor of plaintiff/

ON 87E &+R58 CA@5E O& AC8+ON

1. eclarin% plaintiff entitled to the possession of the abovedescribed propert'/

. 5entencin% defendants :ointl' and severall' to pa' to plaintiff the su$ of P1,-!.!!/

). 5entencin% defendants :ointl' and severall' to pa' plaintiff interest on the a$ount of P1,-!.!! atthe rate 1 per $onth fro$ >ul' 1, 19*! until full' paid/

(. 5entencin% defendants :ointl' and severall' to pa' a$ount e0uivalent to - of the hole a$ountdue as attorne'?s fees/

ON 87E 5ECON CA@5E O& AC8+ON

-. 5entencin% defendants :ointl' and severall' to pa' plaintiff the su$ of P1!!.!! a da' fro$Nove$ber 1(, 19*! until full' paid as penalt'/ .

*. 5entencin% defendants :ointl' and severall' to pa' a$ount e0uivalent to - of the hole a$ountdue as attorne' fees/ .

ON 87E 87+R CA@5E O& AC8+ON

. 5entencin% the defendants :ointl' and severall' to the a$ount of P,1)1.-* as insurance pre$iu$sand such insurance pre$iu$ as $a' accrue at the rate of P,1)1.-* per annu$ fro$ >anuar' 13,19* until the final ter$ination this case/ .

3. 5entencin% defendants :ointl' and severall' to pa' costs of suit< .

9. Plaintiff further pra's for such relief as $a' be :ust and e0uitable in the pre$ises.After due trial, the trial court rendered its :ud%$ent of >anuar' 1(, 19*) in favor of respondent 2plaintiff4 as follos< .

;7ERE&ORE, :ud%$ent is hereb' rendered in favor the plaintiff and a%ainst the defendants Bataan7ardood Corporation, Mauro B. Fan"on and o$in%o B. 5anche", orderin% the said defendants topa' :ointl' and severall' to the plaintiff the su$ of P1,-!.!! ith interest at the rate of 1 per$onth fro$ Au%ust 1*, 19*3, until full' paid, and the a$ount P,1)1.-* ith le%al interest fro$ thedate of filin% of the co$plaint on Au%ust ), 19*1 until full' paid, plus attorne'?s fees of P)!!.!!,and to pa' the costs.



Re%ardin% the counterclai$ for da$a%es for the alle%ed pre$ature sei"ure of the vessel Bat$an, thesa$e bein% under liti%ation in Branch I of this Court, interference b' this Court ill be i$proper.

Respondent, not satisfied ith the :ud%$ent, $oved for its reconsideration and $odification, ur%in% that the :ud%$entshould contain a provision on declarin% it entitled to ta6e possession throu%h the sheriff of the vessel under thereplevin bond tendered b' it and %rant further$ore the stipulated - attorne's fees and the stipulated penalt' ofP1!!.!! per da' of dela'.

8he trial court denied reconsideration in its order of March , 19*), as follos< .@pon consideration of the $otion for reconsideration dated &ebruar' *, 19*), filed b' counsel for theplaintiff, and the opposition thereto as ell as the repl' to the opposition, the said $otion is hereb'denied, the court bein% of the opinion that the attorne'?s fees of P)!!.!! is sufficient because even ifthe a$ount of P1,-!.!! and P,1)1.-* ere aarded to the plaintiff the issues ere not

co$plicated and not too $uch efforts ere e#erted to secure a :ud%$ent in favor of the plaintiff. Asto the a%reed penalt' of P1!!.!! a da', the court is also of the opinion that the sa$e is i$$oral andcontrar' to la and therefore void, speciall' ta6in% into consideration that interests, hich constitutea substantial a$ount, ere alread' alloed.

Both parties appealed the trial court?s decision to the appellate court, althou%h subse0uentl', petitioners? appeal as

defendants as dis$issed b' reason of their failure to file their brief.

8he appellate court favorabl' considered respondent?s appeal on the stipulation for attorne'?s fees, statin% that=2C4onsiderin% the stipulated a$ount hich is - of P1,-!.!! or P(,)1!.!!/ appellee co$pan'?s continued failureto dischar%e its obli%ation despite repeated letters of de$and b' appellant/ the fact that the loer court?s assess$ent

did not include counsel?s efforts on appeal/ and appellant?s representation, hich e find persuasive, that =the a$ountof P)!!.!! is not even sufficient to pa' the assistant attorne' ho folloed up all the incidents in the case=, it is butfair to raise the aard of attorne'?s fees to the su$ of P,!!!.!!.=

+t li6eise $odified the trial court?s rulin% on the contractual penalt' clause, thus< =2;4e are unable to share the loercourt?s vie that the a%reed penalt' of P1!!.!! a da' =is i$$oral and contrar' to la and therefore void cause, apart

fro$ bein% le%all' reco%ni"ed under the Code 2Articles 1*1)!/ *34, li0uidated da$a%es are a%reed uponfor the le%iti$ate purpose of creatin% effective deterrent a%ainst breach of an obli%ation b' $a6in% the conse0uencesof such breach as onerous as $a' be possible. Neither could the court a 'uo base its refusal to reco%ni"e the validit'of the penalt' on the alloance of interest on appellant?s clai$s for it $ust be served, the interest at the rate of 1per annu$ on balance of P1,-!.!! is actuall' co$pensation for a appellants loan of that capital in accordance ith

their voluntar' a%ree$ent in E#hibit A, and therefore, said interest cannot be considered as parta6in% of the nature ofan aard of da$a%es in appellant?s favor. 5i$ilarl', the le%al interest on the additional su$ of P,1)1.-*, hich theloer court further aarded appellant should not be e0uated the penalt' stipulated b' the parties because said interestspecificall' ordained under Article !9 of the Civil Code as a separate conse0uence of appellee co$pan'?s nonpa'$ent of the aforesaid obli%ation, co$pellin% appellant to the present co$plaint. 8he loer court then, si$ilarl'erred hen it co$pletel' disre%arded the stipulated penalt' even if it found the sa$e to be ini0uitous orunconscionable as indeed it is, its discretion as li$ited to an e0uitable reduction of the da$a%es 2Article ,

N.C.C./ Avecilla vs. 5antos, F.R. No. *)(), April 9, 19-(/ Dulo vs. Chan Pe, F.R. No. 1!!*1, April , 19-,-) O.F. -*))4. Considerin% the fact that appellee corporation has $ade partial and irre%ular pa'$ent of theobli%ation, e are further disposed to reduce the a$ount of the penalt' 2Article 1 N.C.C.4/ but on the other hand,considerin% also, the len%th of ti$e that has alread' elapsed since 19*! to the present durin% hich appellant has beendeprived of the use of $one' to%ether ith interest 2@' +sabelo vs. Dandoc, F.R. No. 33!1R, >une !, 19-*4, e

believe the ends of :ustice ill be satisfied b' aardin% appellant the additional su$ of P,!!!.!! b' a' ofli0uidated da$a%es.= .

On respondent?s sub$ittal that it as entitled to a replevin order as pra'ed for b' it, the appellate court ruled thatrespondent =correctl' filed the present co$plaint replevin because appellees have refused to deliver the possession ofthe $ort%a%ed vessel in order that appellant could proceed to foreclose the sa$e e#tra:udiciall'.= .

+t therefore rendered its :ud%$ent of March , 19*3 for respondent as appellant as follos< .

=;7ERE&ORE, ith the $odification that appellant co$pan' is hereb' declared entitled to thepossession of the vessel aforesaid for purpose of e#tra:udicial foreclosure of the chattel $ort%a%e andthat said appellant is hereb' aarded increased attorne'?s fees in the su$ of P,!!!.!! and li0uidated



da$a%es in the further su$ of P,!!!.!!, the appealed decision is affir$ed in all other respects, ithcosts a%ainst appellees.= .

Actin% on petitioners? $otion for reconsideration to reduce the attorne'?s fees and penalt' aarded, the appellate courtheld that =284o ad:ud%e then hat is reasonable in the pre$ises, it is ell to consider counsel?s efforts in pursuin%appellant?s clai$ a%ainst appellees, hich in this case do not reall' a$ount to $uch considerin% that the trial re0uiredonl' to hearin%s and the steno%rapher?s transcript consists of onl' (( pa%es. 8his ould :ustif' a reduction of ourprevious aard of attorne'?s fee thou%h, in an' event, e do not a%ree that the sa$e should be fi#ed at of our previous

aard of P)!!.!! because counsel?s efforts after the rendition of the loer court?s decision up to and includin%plaintiff?s appeal $ust be additionall' co$pensated. On reconsideration, therefore, e hereb' reduce the attorne'?s feeto the a$ount of P3!!.!!.= +t therefore issued its a$endator' resolution of Au%ust , 19*3, as follos< .

=;7ERE&ORE, the decision of this Court dated March , 19*3 is hereb' reconsidered in the sensethat the aard of attorne'?s fee in favor of plaintiffappellant is reduced to the su$ of P3!!.!!/ in all

other respects the $otion for reconsideration is hereb' denied.= .

8he sin%le 0uestion of la posed in this appeal b' petitioners is that the appellate court =co$$itted a %rave error ofla hen it rendered :ud%$ent providin% separate reliefs on t(o causes of action, arisin% out of a single cause ofaction.= 2

Petitioners? tenuous contention is that since respondent plaintiff =has onl' one cause of action, that is, the breach of thecontract b' the defendants GpetitionersH consistin% of GtheirH failure to $a6e the sti$ulated pa'$ents,= then respondent

could not =state to causes of action in GitsH co$plaint, one for replevin and the other, for recover' of a su$ of$one'.= 3 Petitioners? blurred ar%u$entation follos< .

=... Accordin%l', the trial court aarded onl' one relief to the plaintiff and that is for the recover' ofthe su$ of $one' fro$ the defendants. +n %rantin% said relief, the trial court considered as aived,b' the plaintiff, the ri%ht of the plaintiff to foreclose the $ort%a%e, it appearin% that there is onl' onecause of action in the co$plaint. 7oever, the Court of Appeals chose to aard to reliefs to theplaintiff althou%h, actuall' there is onl' one cause of action b' affir$in% the decision of the loercourt for the recover' of a su$ of $one' and for the deliver' of the propert' sub:ect of the $ort%a%e

to the plaintiff for foreclosure thereof. 8his, e sub$it, is erroneous in the pre$ise for there bein%onl' one cause of action, the plaintiff is onl' entitled to onl' one relief. 8he Court cannot %rant theto reliefs pra'ed for b' the plaintiff at the sa$e ti$e but $a' %rant onl' either of the$. +n theinstant case, the trial court chose to %rant relief for the recover' of the su$ of $one'. 5uch a relief

therefore, bars the pra'er for replevin or deliver' of the propert'. 7ence, it is our contention that theCourt of Appeals cannot, under the sa$e co$plaint, %rant the other re$ed' of replevin to the

plaintiff. Althou%h there is onl' one co$plaint in the present case, e respectfull' sub$it that thesa$e co$es under the purvie of the aforecited provisions of Rule of the Rules of Court as tocauses of action are stated therein and that separate reliefs ere pra'ed for.= .

8he petition is $anifestl' ithout $erit.

1. +t is ele$entar', as restated b' the late Chief >ustice Moran, that = the violation of a single right ma) give rise tomore than one relief. *n other (ords, for a single cause of action or violation of a right, the plaintiff ma) be entitled toseveral reliefs. +t is the filin% of separate co$plaints for these several reliefs that constitutes splittin% up of the cause ofaction. 8his is hat is prohibited b' the rule.= !

Moran thus adds, in a$plification, that =cause of action is the delict or ron% b' hich the ri%hts of the plaintiff are

violated b' the defendant. +here there is onl) one delict or (rong, there is but a single cause of action regardless ofthe number of rights that ma) have been violated belonging to one person. And the rule is that all such rights shouldbe alleged in a single complaint, other(ise those that are not therein included cannot be the subect of subse'uentcomplaints, for the) are barred forever . &or instance, hen one?s propert' is ta6en throu%h violence b' another, asin%le delict or ron% is co$$itted consistin% of the ille%al ta6in% of the propert', and accordin%l' there is but a

sin%le cause of action. 8his cause of action, hoever, entitles the plaintiff to to clai$s< one for recover' of propert',and another for da$a%es for its detention b' the defendant. @nder the above stated rule, plaintiff $a' file onl' oneco$plaint e$bracin% the to clai$s. 7e $a' not file to co$plaints, one for the possession and another for da$a%es,for if he does so, he ould be splittin% up a sin%le cause of action into to parts, and the filin% of the first co$plaintould bar the second.=



. 8he appellate court co$$itted no error, therefore, in rulin% that respondent?s co$plaint as principall' for replevinand that respondent =correctl' filed the present co$plaint for replevin because appellees have refused to deliver thepossession of the $ort%a%ed vessel in order that appellant could proceed to foreclose the sa$e e#tra:udiciall'.= 8he

appellate court thus cited the old leadin% case of Bacharach Motor Co. vs. %ummer, holdin% that =2P4reli$inar' tothe sale provided for in section 1( of the Chattel Mort%a%e a, the $ort%a%ee $ust secure possession of the$ort%a%ed chattel, but if possession is refused, he $a' institute an action for replevin or for :udicial foreclosure.= 7 Asnoted b' Moran, =a :udicial proceedin% is, of course, unnecessar' because the $ort%a%ee can foreclose e#tra:udiciall'

b' causin% the $ort%a%ed propert' to be sei"ed b' the sheriff, as a%ent of the $ort%a%ee, and have it sold at publicaction in the $anner prescribed b' section 1( of the Chattel Mort%a%e a.=

). As respondent has $aintained fro$ the be%innin%, its action as for replevin under Rule * of the old Rules ofCourt 2no Rule *! of the Revised Rules4, supported b' the re0uired affidavit under section of the Rule, and theprincipal pra'er of its co$plaint bein% =that upon approval of the plaintiff?s bond, an order be issued directl' to the5heriff of Manila, or an' officer of the court, to ta6e possession of the abovedescribed vessel for the deliver' of thesa$e to plaintiff.=.

Respondent further correctl' $aintained as to the $one' part of the :ud%$ent that = ithout the a$ount or liabilit' ofthe $ort%a%ed vessel deter$ined b' the court, the sheriff ho ill conduct the auction sale ill not have an' poer orauthorit' to deter$ine ho $uch a$ount he has to pa' to the $ort%a%ee, and if he tries to $a6e a deter$ination ofthe a$ount due the $ort%a%ee, the $ort%a%or ill a%ain co$e to court for the deter$ination of his obli%ation to the

$ort%a%ee, and in that a', there ill be a $ultiplicit' of suits hich is froned upon b' the Revised Rules of Court.

7ence, the deter$ination of the a$ount due the respondent ' Pac Co., +nc. as procedurall' correct in order toavoid once and for all the deter$ination of the liabilit' in another court proceedin%.= 9

(. +t is precisel' in accordance ith the principles of nonsplittin% causes of action and avoidin% $ultiplicit' of suitsthat Rule *! 2for$erl' Rule *4 of the Revised Rules of Court in section 9 thereof e#pressl' provides that the court in

a replevin suit =shall render :ud%$ent in the alternative for the deliver' Gof the propert'H to the part' entitled to thesa$e, or for the value in case deliver' cannot be $ade, and also for such da$a%es as either part' $a' prove,= thus< .

=5EC. 9. >ud%$ent. After a trial of the issues the court shall find in ho$ is the ri%ht ofpossession and the value of the propert' and shall render :ud%$ent in the alternative for the deliver'thereof to the part' entitled to the sa$e, or for the value in case deliver' cannot be $ade, and also for

such da$a%es as either part' $a' prove, and for costs.= 2Rule *!4

8his case once a%ain recalls the Court?s ad$onition, throu%h Mr. >ustice >. B. . Re'es, in a si$ilarl' un$eritorious

case. 1/ that = 284he circu$stances surroundin% this liti%ation definitel' prove that appeal is frivolous and a plain tric6to dela' pa'$ent and prolon% liti%ation unnecessaril'. 5uch attitude deserves severe conde$nation, astin%, as it

does, the ti$e that the courts could ell devote to $eritorious cases.= .

8he appellate court, hile not %rantin% the stipulated - attorne'?s fees, increased the trial court?s aard of P)!!.!!to P ,!!!.!! hich it reduced to P3!!.!! upon petitioner?s $otion for reconsideration, supra, 11 on the pre$ise thatcounsel?s efforts in the appellate court $ust be additionall' co$pensated. On the sa$e pre$ise that counsel?s effortsbefore this Court should li6eise be additional co$pensated, the Court aards an additional a$ount of P1,!!.!!

attorne'?s fees for services rendered in this last instance, thereb' $a6in% a total aard of P,!!!.!! for attorne'?s fees.

;7ERE&ORE, the :ud%$ent appealed fro$ is hereb' affir$ed, ith the $odification that petitioners are furtherordered :ointl' and severall' to pa' private respondent in this instance additional attorne'?s fees of P1,!!.!! andtreble costs. 5o ordered.

Concepcion, C.J., Re)es, J.B.-., Maalintal, /aldivar, Castro, "ernando, Barredo, !illamor and Maasiar, JJ.,concur.

"oo0)o0#

1 8his note supplied.

Petition, at p. / e$phasis supplied.

) *dem, at P. 1!.

( 1 Moran?s 19! Ed., p. 119/ e$phasis supplied.



- +de$, at pp. 1191!/ e$phasis supplied.

* ( Phil. ) 21914.

) Moran?s Rules of Court, 19! Ed p. 11-.

3 *dem.

9 Respondent?s brief, pp. 3/ see @niversal Motors Corp. vs. ', 3 5CRA 1*1 2Ma' 1*, 19*94 and

cases cited upholdin% the trial court?s :ud%$ent issuin% the rit of replevin and holdin% the vendorentitled to the possession of the $ort%a%ed truc6 and the vendee liable for the stipulated attorne'?sfees of over P9,!!!.!!.

1! @'puan%co vs. E0uitable Ban6, 5CRA 1 219*94 cited in Fille%o vs. ia", )9 5CRA 332Ma' 9, 1914.

11 At p. .




Manila

EN BANC

G.R. No. L-327! "#$%u&%y 22, 1973

NORTHERN MOTORS, INC., petitioner,

vs.HON. AMEUR"INA MELENCIO HERRERA, Ju*# o 04# Cou%0 o "5%0 I)0&)6# o M&)5l&, B%. 8II, &)*RALPH R. TAGUBA, respondents.

%)cip, %ala0ar, -una, Manalo and "eliciano for petitioner.

Manuel -. 1uerubin for respondents.

ANTONIO, J.:

Ori%inal action for certiorari and mandamus to annul the Orders dated >ul' 1, 19! and >ul' 3, 19! of the Court of

&irst +nstance of Manila, Branch IJ++, in its Civil Case No. 3!19, and to co$$and respondent >ud%e to issue a ritof replevin.

On >une -, 19!, petitioner filed a co$plaint a%ainst respondent Ralph 8a%uba and another person desi%nated as=>ohn oe,= alle%in% inter alia that on &ebruar' 1), 19! 8a%uba e#ecuted in favor of plaintiff a pro$issor' note, acop' of hich as attached to the co$plaint as =Anne# A=, bindin% hi$self to pa' plaintiff the su$ of P13,*).- in

$onthl' install$ents as follos< P-3.- on March 1-, 19*9 and P-1.!! ever' 1-th da' of the $onth for )- $onthsbe%innin% April 1-, 19*9 until &ebruar' 1-, 19, ith 1 interest per annu$ on the unpaid install$ents/ that assecurit' for the pa'$ent of the pro$issor' note, defendant 8a%uba on the sa$e date e#ecuted in favor of plaintiff achattel $ort%a%e over a 19** +$pala sedan, hich deed of $ort%a%e under hich it appears in effect that the saidcar as purchased b' defendant 8a%uba fro$ plaintiff on install$ent basis as dul' re%istered in the chattel$ort%a%e re%istr' of a%una, a cop' of hich deed as also attached thereto as =Anne# B=/ that under the ter$s of

the $ort%a%e, upon default in the pa'$ent of an' install$ent or interest due, the total principal su$ re$ainin% unpaid,

ith accrued interest, shall at once beco$e due and pa'able and the $ort%a%ed car shall, on de$and, be delivered b'the $ort%a%or to the $ort%a%ee, otherise the $ort%a%ee is authori"ed to ta6e possession of the car herever it $a'be found and have it brou%ht to Manila at the e#pense of the $ort%a%or, and the $ort%a%ee shall have the option of 2a4sellin% the $ort%a%ed propert', 2b4 cancellin% the contract of sale ith the $ort%a%or, 2c4 e#tra:udiciall' foreclosin%

the $ort%a%e, 2d4 :udiciall' foreclosin% the $ort%a%e, or 2e4 e#actin% fulfill$ent of the $ort%a%e obli%ation b'ordinar' civil action, the $ort%a%ee be entitled to attorne'?s fees e0uivalent to - of the su$ due in case attorne'?sservices are availed of, it bein% a%reed upon that an' le%al action arisin% fro$ the pro$issor' note $a' be instituted inthe courts of Manila/ that defendant 8a%uba paid onl' the su$ of P9*(.* representin% the install$ent due March 1-,19*9, and another su$ of P)-.( as interest up to >une 13, 19*9, but failed and refused, in spite of repeated de$ands,to pa' P31.(9 of the install$ent due April 1-, 19*9, and the 1) install$ents due Ma' 1-, 19*9 to Ma' 1-, 19!,

thereb' $a6in% the entire unpaid balance of the pro$issor' note in the su$ of P1,*-9.(9 due and de$andable, ithinterest thereon fro$ >une 19, 19*9/ that plaintiff has elected to avail itself of the option of e#tra:udiciall' foreclosin%the $ort%a%e/ that the $ort%a%ed vehicle is in the province of Ri"al in the possession of defendant 8a%uba, ho has

no le%al ri%ht to the possession thereof, plaintiff havin% de$anded the deliver' to it of said vehicle, pursuant to theter$s of the chattel $ort%a%e, but defendant 8a%uba failed and refused to $a6e such deliver'/ that the value of the caris P13,!!!.!!, and said car has not been ta6en for a ta# assess$ent or fine pursuant to la, or sei"ed under an

e#ecution or an attach$ent a%ainst plaintiff?s propert'/ and plaintiff is read' to %ive a bond e#ecuted in defendants?favor in double the value of the car, for the return thereof to defendants if it be so ad:ud%ed, and for pa'$ent to the$of such su$s as the' $a' recover fro$ plaintiff in the action. Plaintiff pra'ed that upon approval of the bond a rit ofreplevin be issued for the sei"ure of the car herever it $a' be found and for its deliver' to plaintiff, and afterhearin%, plaintiff be ad:ud%ed as havin% the ri%htful possession and onership thereof and that in default of deliver',defendants be sentenced to pa' plaintiff the su$ of P1,*-9.(9 ith interest thereon at the rate of 1 per annu$



fro$ >une 19, 19*9, until said principal su$ is full' paid, and a su$ e0uivalent to - of the a$ount due as and forattorne'?s fees and costs of collection, and the costs of suit.

Attached to the co$plaint is a bond for P)*,!!!.!! and an =Affidavit of Replevin= e#ecuted b' an officer of plaintiffcorporation.

On >ul' 1, 19!, an Order as issued b' respondent :ud%e den'in% petitioner?s pra'er for a rit of replevin becausethe rules =re0uire that an affidavit be sub$itted alle%in% that the plaintiff is the oner of the propert' clai$ed, or that

he is entitled to its possession=/ and therefore the affidavit attached to the co$plaint is insufficient, for it is cleartherefro$ that plaintiff =is not the oner of the $otor vehicle $ort%a%ed to it/ and it is not entitled to its possession$erel' because the $ort%a%or has failed to pa' the account %uaranteed b' the $ort%a%e.=

A $otion for reconsideration as filed b' petitioner on >ul' 1!, 19!, but the sa$e as, in an Order dated >ul' 3,19!, li6eise denied b' respondent :ud%e. +t is 7er 7onor?s vie that after the $ort%a%or has breached the chattel

$ort%a%e and refused to deliver the $ort%a%ed chattel to a public officer for foreclosure sale, a replevin suit should beinstituted b' the $ort%a%ee, =but onl' for the purpose of deliverin% the chattel to the public officer for foreclosuresale=. Respondent :ud%e further stated that there bein% no alle%ation that plaintiff $ort%a%ee has as6ed or directed apublic officer to foreclose the $ort%a%e and that the $ort%a%or had refused to surrender the $ort%a%ed chattel to saidpublic officer, it cannot be held that either the public officer or the $ort%a%ee is entitled to replevin/ that the presentco$plaint see6s =that plaintiff be ad:ud%ed to have ri%htful possession= over the chattel ithout 0ualification

hatsoever hich, in the practical sense, can revest onership in it of the repossessed chattel in contravention ofArticle !33 of the Civil Code, and that even if the $ort%a%ee has a ri%ht of possession, that ri%ht is not un0ualifiedbut is sub:ect to the obli%ation of deliverin% the possession of the $ort%a%ed chattel to the public officer forforeclosure.

;e reverse the challen%ed orders.

1. 8here can be no 0uestion that persons havin% a special ri%ht of propert' in the %oods the recover' of hich issou%ht, such as a chattel $ort%a%ee, $a' $aintain an action for replevin therefor. ;here the $ort%a%e authori"es the$ort%a%ee to ta6e possession of the propert' on default, he $a' $aintain an action to recover possession of the$ort%a%ed chattels fro$ the $ort%a%or or fro$ an' person in hose hands he $a' find the$. 8his is irrespective of

hether the $ort%a%e conte$plates a su$$ar' sale of the propert' or foreclosure b' court action 2Podrat v.Oberndorff ! Cal. (-/ *) A..R. 1)!34. As earl' as the case of Bachrach Motor Co. v. %ummers 2( Phil. *4 ;ee#plained that hen the debtor defaults, and the creditor desires to foreclose the $ort%a%ed chattel, he $ustnecessaril' ta6e the $ort%a%ed propert' in his hands, but hen the debtor refuses to 'ield the possession of the

propert', the creditor $ust institute an action, either to effect a :udicial foreclosure directl', or to secure possession asa preli$inar' to the sale conte$plated under 5ection 1( of Act No. 1-!3. 8he ri%ht of the $ort%a%ee to have

possession of the $ort%a%ed chattel after the condition of the $ort%a%e is breached $ust be therefore dee$ed to beell settled.

8he Rules do not re0uire that in an action for replevin, the plaintiff should alle%e that the =$ort%a%ee has as6ed ordirected a public officer to foreclose the $ort%a%e and that the $ort%a%or has refused to surrender the $ort%a%edchattel to such public officer.=

All hat is re0uired b' 5ection of Rule *! is that upon, appl'in% for an order for replevin, the plaintiff $ust shothat he is =the oner of the propert' clai$ed, particularl' describin% it, or is entitled to the possession thereof=/ thatthe propert' is ron%full' detained b' the defendant ith, an alle%ation on the cause of detention/ that the sa$e hasnot been ta6en for an' ta# assess$ent or fine levied pursuant to la nor sei"ed under an' e#ecution, or an attach$enta%ainst the propert' of such plaintiff or if so sei"ed that it is e#e$pt fro$ sei"ure. 8he affidavit $ust also state the

actual value of the propert'. 8he affidavit of 5.M. aureola, Assistant to the Feneral Mana%er of Northern Motors,+nc. attached to the co$plaint, substantiall' co$plies ith the aforecited re0uire$ents.

+n deter$inin% the sufficienc' of the application for rit of replevin, the alle%ations thereof and the recitals of thedocu$ents appended thereto and $ade part thereof should be considered. 8hus it is alle%ed in the co$plaint that =it is

also e#pressl' a%reed beteen the parties that in case of default on the part of defendant, as $ort%a%or therein, the$ort%a%ed $otor vehicle shall be delivered, on de$and, to plaintiff, as $ort%a%ee therein, free of all char%es, andshould the $ort%a%or not deliver the sa$e as aforesaid, the $ort%a%ee is authori"ed to ta6e possession of saidpropert' herever it $a' be found ...= 2par. (4/ that defendant 8a%uba =failed and refused, as he fails and refuses, inspite of repeated de$ands, to pa' the plaintiff P31.(9 of the said install$ent due 1- April 19*9 and the thirteen 21)4install$ents due 1- Ma' 19*9 thru 1- Ma' 19!, thereb' $a6in% the balance of said note, the su$ of P1,*-9.(9, and



interest fro$ 19 >une 19*9, to beco$e i$$ediatel' due, pa'able and defaulted= 2par. *4/ and that =the $ort%a%ed$otor vehicle is no in Ri"al in the possession of defendants ho have no le%al ri%ht to the possession thereof plaintiff havin% $ade de$and for the deliver' of the said $otor vehicle pursuant to the ter$s of the chattel $ort%a%e

notithstandin% hich de$and defendants have failed and refused to do so= 2par. 4. 8hese alle%ations of theco$plaint ere b' reference $ade part of >. M. aureola?s affidavit.

;e find nothin% fro$ the provisions of 5ection 1( of the Chattel Mort%a%e a 2Act 1-!34 that ould :ustif' the trialcourt?s insistence, that after default b' the $ort%a%or and before the $ort%a%ee can file an action to recover possession

of the $ort%a%ed chattel, the $ort%a%ee $ust first as6 the sheriff to foreclose the $ort%a%e and it is onl' hen the$ort%a%or refuses to surrender the chattel to the sheriff that the action of replevin can be instituted. ;e clearl'e#plained in Bachrach Motor Co. v. %ummers, supra, that, hile 5ection 1( of Act 1-!3 places upon =a public officer=the responsibilit' of conductin% the sale of the $ort%a%ed chattel, there is nothin% in said statute hich ouldauthori"e the officer to sei"e the $ort%a%ed propert'/ and that for the recover' of possession of said propert', herethe ri%ht is disputed, =the creditor $ust proceed alon% the channels b' action in court.= 8he basic reason h' thecreditor should initiate such action is because of the circu$stances that the creditor?s ri%ht of possession of the

sub:ect$atter of the chattel $ort%a%e, as a preli$inar' to an e#tra:udicial foreclosure proceedin%, is conditionedupon the fact of actual default on the part of the principal obli%or, and the e#istence of this fact $a' naturall' be thesub:ect of controvers'. +n case of such default and the $ort%a%ee refuses upon de$and, to surrender possession of the$ort%a%ed chattel so that it $a' be sold at public auction pursuant to 5ection 1( of Act 1-!3, it ould certainl' be ane#ercise in futilit' for the $ort%a%ee to first re0uest or direct the sheriff to =foreclose the $ort%a%e= or ta6e possessionof the propert', before filin% an action in court to recover its possession. 5uch a procedure is co$pletel' unnecessar'

not onl' because the sheriff has no dut' or authorit' in the first instance to sei"e the $ort%a%ed propert', but alsobecause henever the sheriff proceeds under section 1( of the Chattel Mort%a%e a, he beco$es pro hac vice the$ere a%ent of the creditor. +n an' event it is onl' upon receivin% the order of the Court re0uirin% the sheriff to ta6eforthith such propert' into his custod', that the dut' of said officer to ta6e possession of the $ort%a%ed chattel arises25ection (, Rule *!, Revised Rules of Court4. +t as therefore error for the court a 0uo to hold that petitioner has notsufficientl' averred its ri%ht to the possession of the propert' sou%ht to be recovered.

. 8here is also no support for the assertion that the petitioner see6s to appropriate the propert' %iven b' a' of$ort%a%e or dispose of it in a $anner violative of Article !33 of the ne Civil Code.

8he essence of pacto commissorio, hich is prohibited b' Article !33 of the Civil Code, is that onership of the

securit' ill pass to the creditor b' the $ere default of the debtor 2Fuerrero v. DKi%o, et al., 9* Phil. ), (1(/ Pui% v.5ellner, et al., (- Phil. 3*, 3334. +n the present case, the petitioner, e#ercisin% one of the options open to it under

the ter$s of the chattel $ort%a%e, elected to e#tra:udiciall' foreclose the $ort%a%e, and as a step preli$inar' to suchforeclosure, sou%ht for the possession of the $ort%a%ed car and in the alternative, pra'ed for the pa'$ent b' theprivate respondent of the principal su$ of P1,*-9.(9 due to it, plus interest thereon at 1 per annu$ fro$ >une 19,19*9 until full' paid and attorne'?s fees. No auto$atic revestin% of title on the creditor as ever conte$plated, for the

e#ercise of the re$edies %ranted to the creditor b' the deed of chattel $ort%a%e of foreclosin% the chattel $ort%a%e ore#actin% the fulfill$ent of the obli%ation thru court action is b' its ver' nature anathe$a to the concept of pactocommissorio.

;7ERE&ORE, the rits pra'ed for are %ranted. 8he orders co$plained of are accordin%l' set aside, and the court a

0uo is hereb' ordered to issue the rit of replevin pra'ed for b' petitioner. Costs a%ainst privaterespondent.Concepcion, C.J., /aldivar, Castro, "ernando, 2eehanee, Barredo, Maasiar and 3sguerra, JJ., concur.

Maalintal J., too no part




Manila

THIR I8ISION

G.R. No. 1737 "#$%u&%y 11, 2//

SPS. RA"AEL P. ESTANISLAO AN ENAIA ESTANISLAO, petitioners,

vs.EAST 'EST BAN+ING CORPORATION, respondent.

ECISION

YNARES-SANTIAGO, J .:

8his is a petition for revie of the ecision1 of the Court of Appeals dated April 1), !! in CAF.R. CJ No. 311(hich reversed and set aside the ecision of the Re%ional 8rial Court of Antipolo Cit', Branch ) in Civil Case No.!!-)1. 8he appellate court entered a ne :ud%$ent orderin% petitioners spouses Estanislao to pa' respondent East

;est Ban6in% Corporation P(,-,919.*- plus interest and attorne'Ls fees. Also assailed is the Resolution dated >une-, !! den'in% the $otion for reconsideration.

8he facts are as follos<

On >ul' (, 199, petitioners obtained a loan fro$ the respondent in the a$ount of P),9-,!!!.!! evidenced b' apro$issor' note and secured b' to deeds of chattel $ort%a%e dated >ul' 1!, 199< one coverin% to du$p truc6s anda bulldo"er to secure the loan a$ount of P,)-,!!!.!!, and another coverin% bulldo"er and a heel loader to securethe loan a$ount of P1,--!,!!!.!!. Petitioners defaulted in the a$orti"ations and the entire obli%ation beca$e due andde$andable.

On April 1!, !!!, respondent ban6 filed a suit for replevin ith da$a%es, pra'in% that the e0uip$ent covered b' thefirst deed of chattel $ort%a%e be sei"ed and delivered to it. +n the alternative, respondent pra'ed that petitioners beordered to pa' the outstandin% principal a$ount of P),3(*,1.) ith 19.- interest per annu$ rec6oned fro$

:udicial de$and until full' paid, e#e$plar' da$a%es of P-!,!!!.!!, attorne'Ls fees e0uivalent to ! of the totala$ount due, other e#penses and costs of suit.

8he case as filed in the Re%ional 8rial Court of Antipolo and raffled to Branch ) thereof.

5ubse0uentl', respondent $oved for suspension of the proceedin%s on account of an earnest atte$pt to arrive at ana$icable settle$ent of the case. 8he trial court suspended the proceedin%s, and durin% the course of ne%otiations, adeed of assi%n$ent) dated Au%ust 1*, !!! as drafted b' the respondent, hich provides in part, that<

# # # the A55+FNOR is 5)*#$0#* 0o 04# ASSIGNEE 5) 04# &%#&0# u; o SE8EN MILLION THREEHUNRE "I8E THOUSAN "OUR HUNRE "I"TY NINE PESOS &)* "I"TY T'OCENTA8OS <P7,3/,!9.2=, P45l5>>5)# 6u%%#)6y, 5)6lu5?# o &66%u#* 5)0#%#0 &)* >#)&l05# & oAuu0 1, 2///, &)* 5) ull >&y;#)0 04#%#o, 04# ASSIGNOR *o# 4#%#$y ASSIGN, TRANS"ER &)*CON8EY u)0o 04# ASSIGNEE 04o# ;o0o% ?#456l#, ith all their tools and accessories, $ore particularl'

described as follos<

Ma6e < +su"u u$p 8ruc6

# # #

Ma6e < +su"u u$p 8ruc6

# # #

Ma6e < # # # Caterpillar Bulldo"er # # #

8hat the ASSIGNEE 4#%#$y &66#>0 04# &5);#)0 5) ull >&y;#)0 o 04# &$o?#-;#)05o)#* *#$0 # # #.2E$phasis supplied4

Petitioners affi#ed their si%natures on the deed of assi%n$ent. 7oever, for so$e un6non reason, respondent ban6Ls

dul' authori"ed representative failed to si%n the deed.

http://www.lawphil.net/judjuris/juri2008/feb2008/gr_178537_2008.html#fnt1









On October *, !!! and March 3, !!1, respectivel', petitioners co$pleted the deliver' of the heav' e0uip$ent$entioned in the deed of assi%n$ent to du$p truc6s and a bulldo"er to respondent, hich accepted the sa$eithout protest or ob:ection.

7oever, on >une !, !!1, respondent filed a $anifestation and $otion to ad$it an a$ended co$plaint for thesei"ure and deliver' of to $ore heav' e0uip$ent the bulldo"er and heel loader hich are covered under thesecond deed of chattel $ort%a%e. Respondent clai$ed that its representative inadvertentl' failed to include the seconddeed of chattel $ort%a%e a$on% the docu$ents forarded to its counsel hen the ori%inal co$plaint as bein%

drafted. Respondent li6eise clai$ed that petitioners ere %iven a chance to sub$it a refinancin% sche$e that ouldallo the$ to 6eep the re$ainin% to heav' e0uip$ent, but the' failed to co$e up ith such a sche$e despiterepeated pro$ises to do so.

RespondentLs a$ended co$plaint for replevin alle%ed that petitionersL outstandin% indebtedness as of >une 1(, !!1stood at P(,-,919.*1 hich is $ore or less e0ual to the a%%re%ate value of the additional units of heav' e0uip$ent

sou%ht to be recovered. +t also pra'ed that, in the event the to heav' e0uip$ent could not be replevied, petitioners beordered to pa' the outstandin% su$ of P),3(*,1.) ith 19.- interest per annu$ rec6oned fro$ >anuar' (, 1993,co$pound interest, e#e$plar' da$a%es of P-!,!!!.!!, attorne'Ls fees e0uivalent to ! of the total a$ount due,other e#penses and costs of suit.

Petitioners sou%ht to dis$iss the a$ended co$plaint. 8he' alle%ed that their previous pa'$ents on loan

a$orti"ations, the e#ecution of the deed of assi%n$ent on Au%ust 1*, !!!, and respondentLs acceptance of the threeunits of heav' e0uip$ent, had the effect of full pa'$ent or satisfaction of their total outstandin% obli%ation hich is abar on respondent ban6 fro$ recoverin% an' $ore a$ounts fro$ the$. B' a' of counterclai$, petitioners sou%ht theaard of no$inal da$a%es in the a$ount of P-!!,!!!.!!, $oral da$a%es in the a$ount of P-!!,!!!.!!, e#e$plar'da$a%es in the a$ount of P-!!,!!!.!!, attorne'Ls fees, liti%ation e#penses, interest and costs.

On March 1(, !!*, the trial court dis$issed the a$ended co$plaint for lac6 of $erit. +t held that the deed ofassi%n$ent and the petitionersL deliver' of the heav' e0uip$ent effectivel' e#tin%uished petitionersL total loanobli%ation. +t also held that respondent as estopped fro$ further collectin% fro$ the petitioners hen it accepted,ithout an' protest, deliver' of the three units of heav' e0uip$ent as full and co$plete satisfaction of the petitionersLtotal loan obli%ation. Respondent li6eise failed to ti$el' rectif' its alle%ed $ista6e in the ori%inal co$plaint anddeed of assi%n$ent, ta6in% al$ost a 'ear to act.

Respondent ban6 appealed to the Court of Appeals, hich reversed the trial courtLs decision, the dispositive portion ofhich reads<

;7ERE&ORE, pre$ises considered, the present appeal is hereb' FRAN8E. 8he ecision dated March 1(,!!* of the Re%ional 8rial Court of Antipolo Cit', Branch ) in Civil Case No. !!-)1 is hereb'REJER5E and 5E8 A5+E. A ne :ud%$ent is hereb' entered orderin% the defendantsappellees to pa',

:ointl' and severall', plaintiffappellant East ;est Ban6in% Corporation the su$ of &O@R M++ON 8;O7@NRE 5EJEN8D &+JE 87O@5AN N+NE 7@NRE N+NE8EEN and *91!! 2P(,-,919.*94 per5tate$ent of Account as of >une 1(, !!1 2E#h. =E=, Records, p.)34 ith interest at 1 per annu$ fro$>une 1-, !!1 until full pa'$ent thereof. efendantsappellees are li6eise ordered to pa' the plaintiff

appellant attorne'Ls fees in the su$ e0uivalent to ten per cent 21!4 of the total a$ount due.

No pronounce$ent as to costs.

5O ORERE.(

8he reversal of the loer courtLs decision hin%es on< 214 the appellate courtLs findin% that the deed of assi%n$ent

cannot bind the respondent because it did not si%n the sa$e. 8he appellate court ruled that the assi%n$ent contractas never perfected althou%h it as prepared and drafted b' the respondent/ 24 respondent as not estopped b' itson declarations in the deed of assi%n$ent, because such declarations ere the result of =i%norance founded upon aninnocent $ista6e= and =plain oversi%ht= on the part of respondentLs staff in the ban6Ls loan operations depart$ent,

ho failed to forard the co$plete docu$ents pertainin% to petitionersL account to the ban6Ls le%al depart$ent, suchthat hen the ori%inal co$plaint for replevin as prepared, the second deed of chattel $ort%a%e coverin% to otherpieces of heav' e0uip$ent as inadvertentl' e#cluded/ 2)4 petitioners are aare that there ere five pieces of heav'e0uip$ent under chattel $ort%a%e for an outstandin% balance of over P $illion/ and 2(4 the appellate court held thateven after the deliver' of the heav' e0uip$ent covered b' the deed of assi%n$ent, the petitioners continued to






ne%otiate ith the respondent on a possible refinancin% sche$e that ill enable the$ to retain the to other units ofheav' e0uip$ent still in their possession and hich are the sub:ect of the second deed of chattel $ort%a%e.

Petitioners ar%ue that< a4 the appellate court erred in orderin% the pa'$ent of the principal obli%ation in a replevin suithich it erroneousl' treated as a collection case/ b4 the deed of assi%n$ent is bindin% beteen the parties althou%h itas not si%ned b' the respondent, constitutin% as it did an offer hich the' validl' accepted/ and c4 the respondent isestopped fro$ collectin% or foreclosin% on the second deed of chattel $ort%a%e.

On the other hand, respondent ar%ues that< a4 the deed of assi%n$ent produced no le%al effect beteen the parties forfailure of the respondent to si%n the sa$e/ b4 the deed as founded on a $ista6e on its part because it honestl'believed that onl' one chattel $ort%a%e had been constituted to secure the petitionersL obli%ation/ c4 the noninclusionof the second deed of chattel $ort%a%e in the ori%inal co$plaint as a case of =plain oversi%ht= on the part of the loanoperations unit of respondent ban6, hich failed to forard to the le%al depart$ent the co$plete docu$entspertainin% to the petitionersL loan account/ d4 the continued ne%otiations in Au%ust !!1 beteen the parties, after

deliver' of the three units of heav' e0uip$ent, proves that petitioners ac6noled%ed their continuin% obli%ations torespondent under the second deed of $ort%a%e/ and, e4 the deed of assi%n$ent did not have the effect of novatin% theori%inal loan obli%ation.

8he issue for resolution is< id the deed of assi%n$ent hich e#pressl' provides that the transfer and conve'ance torespondent of the three units of heav' e0uip$ent, and its acceptance thereof, shall be 5) ull >&y;#)0 of the

petitionersL total outstandin% obli%ation to the latter operate to e#tin%uish petitionersL debt to respondent, such thatthe replevin suit could no lon%er prosper

;e find $erit in the petition.

8he appellate court erroneousl' deno$inated the replevin suit as a collection case. A readin% of the ori%inal anda$ended co$plaints sho that hat the respondent initiated as a pure replevin suit, and not a collection case.Recover' of the heav' e0uip$ent as the principal ai$ of the suit/ pa'$ent of the total obli%ation as $erel' analternative pra'er hich respondent sou%ht in the event $anual deliver' of the heav' e0uip$ent could no lon%er be$ade.

Replevin, broadl' understood, is both a for$ of principal re$ed' and a provisional relief. +t $a' refer either to theaction itself, i.e., to re%ain the possession of personal chattels bein% ron%full' detained fro$ the plaintiff b' another,or to the provisional re$ed' that ould allo the plaintiff to retain the thin% durin% the pendenc' of the action andhold it pendente lite.-

8he deed of assi%n$ent as a perfected a%ree$ent hich e#tin%uished petitionersL total outstandin% obli%ation to therespondent. 8he deed e#plicitl' provides that the assi%nor 2petitioners4, @5) ull >&y;#)0@ of its obli%ation in thea$ount of P,)!-,(-9.-, shall deliver the three units of heav' e0uip$ent to the assi%nee 2respondent4,hich@&66#>0 04# &5);#)0 5) ull >&y;#)0 o 04# &$o?#-;#)05o)#* *#$0.@ 8his could onl' $ean that shouldpetitioners co$plete the deliver' of the three units of heav' e0uip$ent covered b' the deed, respondentLs credit ouldhave been satisfied 5) ull, and petitionersL a%%re%ate indebtedness of P,)!-,(-9.- ould then be considered to havebeen paid 5) ull as ell.

8he nature of the assi%n$ent as a dation in pa'$ent, hereb' propert' is alienated to the creditor in satisfaction of adebt in $one'. 5uch transaction is %overned b' the la on sales. * Even if e ere to consider the a%ree$ent as aco$pro$ise a%ree$ent, there as no need for respondentLs si%nature on the sa$e, because ith the deliver' of theheav' e0uip$ent hich the latter accepted, the a%ree$ent as consu$$ated. RespondentLs approval $a' be inferred

fro$ its un0ualified acceptance of the heav' e0uip$ent.

Consent to contracts is $anifested b' the $eetin% of the offer and the acceptance of the thin% and the cause hich areto constitute the contract/ the offer $ust be certain and the acceptance absolute. 8he acceptance of an offer $ust be$ade 6non to the offeror, and unless the offeror 6nos of the acceptance, there is no $eetin% of the $inds of theparties, no real concurrence of offer and acceptance.3 @pon due acceptance, the contract is perfected, and fro$ that

$o$ent the parties are bound not onl' to the fulfill$ent of hat has been e#pressl' stipulated but also to all theconse0uences hich, accordin% to their nature, $a' be in 6eepin% ith %ood faith, usa%e and la. 9

;ith its 'ears of ban6in% e#perience, resources and $anpoer, respondent ban6 is presu$ed to be fa$iliar ith thei$plications of enterin% into the deed of assi%n$ent, hose ter$s are cate%orical and left nothin% for interpretation.8he alle%ed noninclusion in the deed of certain units of heav' e0uip$ent due to inadvertence, plain oversi%ht or

$ista6e, is tanta$ount to ine#cusable $anifest ne%li%ence, hich should not invalidate the :uridical tie that as














created.1! Respondent is presu$ed to have $aintained a hi%h level of $eticulousness in its dealin%s ith petitioners.8he business of a ban6 is affected ith public interest/ thus, it $a6es a sorn profession of dili%ence and$eticulousness in %ivin% irreproachable service.11

Besides, respondentLs protestations of $ista6e and plain oversi%ht are selfservin%. 8he evidence sho that fro$Au%ust 1*, !!! 2date of the deed of assi%n$ent4 up to March 3, !!1 2the date of deliver' of the last unit of heav'e0uip$ent covered under the deed4, respondent did not raise an' ob:ections nor $a6e an' $ove to 0uestion,invalidate or rescind the deed of assi%n$ent. +t as not until >une !, !!1 that respondent raised the issue of its

alle%ed $ista6e b' filin% an a$ended co$plaint for replevin involvin% different chattels, althou%h founded on thesa$e principal obli%ation.

8he le%al presu$ption is ala's on the validit' of contracts.1 +n order to :ud%e the intention of the contractin%parties, their conte$poraneous and subse0uent acts shall be principall' considered.1) ;hen respondent accepteddeliver' of all three units of heav' e0uip$ent under the deed of assi%n$ent, there could be no doubt that it intended to

be bound under the a%ree$ent.

5ince the a%ree$ent as consu$$ated b' the deliver' on March 3, !!1 of the last unit of heav' e0uip$ent underthe deed, petitioners are dee$ed to have been released fro$ all their obli%ations to respondent.

5ince there is no $ore credit to collect, no principal obli%ation to spea6 of, then there is no $ore second deed of

chattel $ort%a%e that $a' subsist. A chattel $ort%a%e cannot e#ist as an independent contract since its consideration isthe sa$e as that of the principal contract. Bein% a $ere accessor' contract, its validit' ould depend on the validit' of

the loan secured b' it.1( 8his bein% so, the a$ended co$plaint for replevin should be dis$issed, because the chattel$ort%a%e a%ree$ent upon hich it is based had been rendered ineffectual.

'HERE"ORE, the petition is GRANTE. 8he ecision of the Court of Appeals dated April 1), !! in CAF.R.CJ No. 311( and its Resolution dated >une -, !! are hereb' SET ASIE. 8he March 1(, !!* decision of theRe%ional 8rial Court of Antipolo, Branch ), hich dis$isses Civil Case No. !!-)1, is hereb' REINSTATE.

SO ORERE.

CONSUELO YNARES-SANTIAGOAssociate >ustice

;E CONC@R<

MA. ALICIA AUSTRIA-MARTINEAssociate >ustice

RENATO C. CORONAAssociate >ustice

ANTONIO EUARO B. NACHURAAssociate >ustice

RUBEN T. REYESAssociate >ustice

ATTESTATION

+ attest that the conclusions in the above decision ere reached in consultation before the case as assi%ned to theriter of the opinion of the CourtLs ivision.

CONSUELO YNARES-SANTIAGOAssociate >ustice

Chairperson, 8hird ivision






http://www.lawphil.net/judjuris/juri2008/feb2008/gr_178537_2008.html#fnt*






http://www.lawphil.net/judjuris/juri2008/feb2008/gr_178537_2008.html#fnt*



CERTI"ICATION

Pursuant to 5ection 1), Article J+++ of the Constitution and the ivision ChairpersonLs Attestation, it is hereb'

certified that the conclusions in the above ecision ere reached in consultation before the case as assi%ned to theriter of the opinion of the CourtLs ivision.

REYNATO S. PUNOChief >ustice

"oo0)o0#

+n lieu of >ustice Minita J. ChicoNa"ario, per 5pecial Order No. (3( dated >anuar' 11, !!3.

1 Rollo, pp. -11. Penned b' Associate >ustice Martin 5. Jillara$a, >r. and concurred in b' Associate

>ustices 7a6i$ 5. Abdulahid and Arturo F. 8a'a%.

*d. at ).

) *d. at -(.

( *d. at 1.

- BA "inance Corporation v. Court of Appeals, F.R. No. 1!993, >ul' -, 199*, -3 5CRA 1!, 11!.

* C+J+ COE, Art. 1(-.

*d., Art. 1)19.

3 Malbarosa v. Court of Appeals, F.R. No. 1-*1, April )!, !!), (! 5CRA 1*3, 1.

9 C+J+ COE, Art. 1)1-.

1! "ule v. Court of Appeals, F.R. No. 111, March , 1993, 9* 5CRA *93, 1-.

11 %olidban v. Arrieta, F.R. No. 1-!, &ebruar' 1, !!-, (-1 5CRA 11, .

1 &eople4s Aircargo and +arehousing Co., *nc. v. Court of Appeals, F.R. No. 113(, October , 1993, 95CRA 1!, 139.

1) Civil Code, Article 1)1.

1( Naguiat v. Court of Appeals, F.R. No. 113)-, October ), !!), (1 5CRA -91, -99.

http://www.lawphil.net/judjuris/juri2008/feb2008/gr_178537_2008.html#rnt*

http://www.lawphil.net/judjuris/juri2008/feb2008/gr_178537_2008.html#rnt1





http://www.lawphil.net/judjuris/juri1996/jul1996/gr_102998_1996.html






http://www.lawphil.net/judjuris/juri2003/apr2003/gr_125761_2003.html





http://www.lawphil.net/judjuris/juri1998/mar1998/gr_112212_1998.html



http://www.lawphil.net/judjuris/juri2005/feb2005/gr_152720_2005.html




http://www.lawphil.net/judjuris/juri1998/oct1998/gr_117847_1998.html





http://www.lawphil.net/judjuris/juri2008/feb2008/gr_178537_2008.html#rnt*
























Manila

87+R +J+5+ON

G.R. No. !29! O60o$#% 1, 199

BA "INANCE CORPORATION, petitioner,

vs.COURT O" APPEALS, HON. PONCIANO C. INOPIUE P%#5*5) Ju*# o B%&)64 I8 o 04# R#5o)&lT%5&l Cou%0 o M&)5l& &)* 'ILSON SIY, respondents.

1uiason, Maalintal, Barot, 2orres 5 *barra for petitioner.

%antiago 5 %antiago for private respondent.

"ELICIANO, J.:

8he petitioner here as6s us to revie on certiorari a Court of Appeals? decision hich affir$ed a trial court orderden'in% BA &inance Corporation?s notice of appeal for havin% been filed be'ond the fifteenda' re%la$entar' period.

On 1- >une 193*, Dan6' 7ardare Co$pan', +nc. 2=Dan6'=4 applied for and as %ranted b' BA &inance Corporation2=BA &inance=4, a credit acco$$odation in the for$ of a discountin% line under hich the for$er could fro$ ti$e toti$e discount ith, and assi%n its trade receivables to, BA &inance. 8o secure the pa'$ent of all loan obtained or to be

obtained, Dan6' e#ecuted a chattel $ort%a%e 1 over its stoc6intrade or $erchandise inventor' in favor of BA&inance. 8o %uarantee those loans, Antonio N%ui De6 5ie$, President and Feneral Mana%er of Dan6', e#ecuted acontinuin% suret'ship a%ree$ent 2 in favor of BA &inance.

On various occasions, Dan6' dre on that credit acco$$odation and e#ecuted in favor of BA &inance separate deedsof assi%n$ent.

+n ti$e, BA &inance de$anded fro$ Dan6' the pa'$ent of its accu$ulated obli%ations hich, as of ! October 1931,had alle%edl' reached the a$ount of P--9,-*-.!!, or the deliver' of the $ort%a%ed chattels for purposes ofe#tra:udicial foreclosure.

On 1 October 1931, BA &inance filed ith the then Court of &irst +nstance 2=C&+=4 a co$plaint a%ainst Dan6' andAntonio N%ui De6 5ie$ for replevin ith da$a%es or, in the alternative, pa'$ent of the a$ount of P--9,-*-.!! plusinterest. BA &inance contended that it had the ri%ht to ta6e possession of the chattels described in the chattel $ort%a%eor to be paid the total a$ount of the loans plus interest since Dan6' had breached the conditions of the chattel$ort%a%e b' failin% to pa' the a$ounts secured thereb'.

On * October 1931, the C&+ ordered the sei"ure of all the $erchandise inventories and other personal propertiesdescribed in the chattel $ort%a%e. 5heriff Rolando Balin%it accordin%l' sei"ed chattels found in the pre$ises of Dan6'and later transferred these to BA &inance?s arehouse. Balin%it sub$itted a sheriff?s receipt 3 dated * October 1931containin% a list of the properties sei"ed, and a sheriff s return ! dated ( Nove$ber 1931. But on - Nove$ber 1931,sheriff Balin%it filed another report dated - Nove$ber 1931 hich accordin% to hi$ superseded the earlier list,statin% therein that this list as arrived at after he and so$e BA &inance e$plo'ees had conducted a reinventor' of

the replevied chattels in BA &inance?s arehouse.

Dan6' and Antonio N%ui De6 5ie$ filed an anser clai$in% that since not all of their obli%ations ere due, BA&inance had as 'et no cause of action a%ainst the$.

Meanhile, Dan6' ca$e into deep financial difficulties. Ri"al Co$$ercial Ban6in% Corporation 2=RCBC=4, ChinaBan6in% Corporation 2=China Ban6=4 and +nternational Corporate Ban6 2=+nterBan6=4 intervened in the replevin caseas creditors of Dan6'. urin% a pretrial conference on &ebruar' 193( RCBC $oved for the sale at public auctionof the replevied chattels in order to prevent further depreciation of their value. BA &inance and the rest of theintervenors accepted that su%%estion/ on the sa$e da', the C&+ accordin%l' issued an order statin% a$on% otherthin%s that<

Considerin% that all la'ers appearin% in this case have agreed to the sale of the propertiesenumerated in the list of properties mortgaged, page 67 of the record at public auction, under the



supervision of the eput' 5heriff of this court, upon the :oint $otion of Att'. Noel Ebarle forplaintiff and Att'. Jenerando Parun%o for intervenor RCBC, the pretrial conference is hereb' reset toApril , 193( at 3<)! sharp.

8he court directs that the proceeds of the auction sale be deposited in a %overn$ent ban6. 7

### ### ###

After havin% been rescheduled tice, a public auction sale as finall' conducted on )1 April 193( at BA &inance?s

;arehouse in Epifanio de los 5antos Ave., Mandalu'on%, Metro Manila. 8he hi%hest bidder as private respondent;ilson 5i' hose innin% bid as P*!,!!!.!!. After the sale, eput' 5heriff Rodolfo P. 8orella sub$itted a 5heriff sReport. BA &inance, hoever, $oved to cancel the auction sale on the %round that hile it 2BA &inance4 as read'to bid for the auctioned properties for P1-!,!!!.!!, it had been i$properl' deprived of its ri%ht to participate in thebiddin% b' the sheriff ho insisted that BA &inance pa' for its bid in cash. BA &inance as thus forced to put to%ether

P1-!,!!!.!! in bills and since the countin% of the bills too6 so$eti$e, its representative arrived late for the biddin%.8he trial court cancelled 9 the auction sale on the %round that the price reali"ed as shoc6in%l' lo, the auction salehavin% been hastil' conducted. ater, hoever, this order as reconsidered b' the trial court after 5i' posted a bond inthe a$ount of P1(!,!!!.!!.

5i' then filed a Motion ith the trial court see6in% the production and deliver' of certain chattels alle%edl' sold in the

auction sale but not delivered b' BA &inance to hi$. BA &inance countered that the chattels referred to b' 5i' as stillundelivered ere those included in an inventor' list attached to the sheriffs report dated - Nove$ber 1931, hich list

had not been furnished to BA &inance prior to the auction sale and hich, $ore i$portantl', accordin% to BA &inance,listed not onl' chattels replevied b' Dan6' but also other personalt' hich had been repossessed fro$ BA &inance?sother clients. 8he trial court appointed a co$$issioner to loo6 into the $atter. 8he first co$$issioner rendered areport statin% that BA &inance should produce or account for certain undelivered personal properties. BA &inance and

the intervenor ban6s opposed this report and the court disapproved it. A second co$$issioner as desi%nated b' thetrial court. 8his co$$issioner si$ilarl' reported that not all of the properties $ort%a%ed and sold at a public auctionhad been delivered to 5i' as hi%hest bidder. 8he second report as approved b' the trial court in an order 1/ dated 11>une 193-.

BA &inance $oved for reconsideration of this last order of the trial court, ithout success. On ( 5epte$ber 193-, theC&+ issued an order the dispositive portion of hich re0uired BA &inance to deliver the alle%edl' $issin% chattels ortheir value<

;7ERE&ORE, sub:ect to the $odification as stated above, the order of this Court dated >ul' )1,

193- is hereb' reconsidered and $odified accordin%l'. 8he Motion for +ssuance of a ;rit ofE#ecution is denied.

2he plaintiff is hereb) directed to deliver to highest bidder +ilson %i) the aformentioned list of propertiesor if not possible the e'uivalent amount thereof. And for this purpose, Att'. Noel !. Ebarle is hereb'

directed to $anifest in ritin% ithin five 2-4 da's fro$ receipt hereof his preference as to the basis of the

price hether to follo the price list as alread' stated on pa%e (! of the records or the current price in

hich case there is a necessit' of appointin% a co$$ittee to canvass the current price. And if the plaintiff

chooses the latter, then this Court is hereb' appointin% Att'. &rancisco 5anche" +++, le%al researcher of this

Court as Chair$an and one representative for the hi%hest bidder, as $e$bers. And if the choice is the

for$er, then it is onl' a $atter of co$putation. +n the event that there is no $anifestation fro$ the plaintiff

ithin five 2-4 da's fro$ receipt of this Order, then it is understood that the price list as stated on page 67of the records 8list of mortgaged properties9 (ould be the basis for the Court to determine the price of the

undelivered properties. 1183mphasis supplied98his ti$e, it as 5i' ho filed a Motion for Reconsideration. 7e contended that because BA &inance as depositor'of the chattels, it should be $ade liable to hi$ for da$a%es for havin% failed to deliver the chattels listed in aninventor' dated October 1931. 8he Court issued an order dated >anuar' 193* hich provided in its dispositiveportion as follos<

;7ERE&ORE, the order of 5epte$ber (, 193- is hereb' a$ended andor $odified in that the plaintiff

GBA &inanceH is hereb' directed to deliver to the highest bidder, +ilson %i), the properties appearing in

the list of inventor) attached to the %heriff:s report dated November ;, <=>< as appearing on pp. <>>?@77

of the record of this case minus the properties alread) delivered on June @>, <=>6 to Mr. +ilson %i), and if

this is not possible, to pa) the e'uivalent amount thereof. +n deter$inin% the a$ount of these properties,



the Court hereb' appoints a co$$ittee to be chaired b' Att'. &rancisco 5anche" +++, e%al Researcher ofthis Court, and one representative each fro$ the plaintiff and the hi%hest bidder, as $e$bers, to canvass

the current price of the sub:ect properties and to $a6e a report thereon ithin tent' 2!4 da's fro$ the

date the co$$ittee is for$ed. 12 2+talics supplied4

On ! &ebruar' 193*, i.e., tent'three 2)4 da's after its receipt of the order last 0uoted above, BA &inance filed itsnotice of appeal and a record on appeal ith the C&+. 8he trial court, hoever, in an order dated >une 193*,

disapproved the notice of appeal and record on appeal as havin% been filed out of ti$e. BA &inance?s Motion for

Reconsideration of this order as denied.

BA &inance then ent to the Court of Appeals on a Petition for mandamus and Certiorari, see6in% to set aside theC&+?s orders of >une 193* and 1* >ul' 193*. Petitioner there ur%ed that the C&+ order of >anuar' 193* hadresolved, not the replevin case itself but rather an incidental issue therein/ that the case as one here $ultiple

appeals ere proper/ and that, therefore, the re%le$entar' period for appeal as thirt' 2)!4 da's and not fifteen 21-4da's.

8he Court of Appeals dis$issed 13 the Petition, rulin% that since the order of the C&+ dated >anuar' 193* had full'disposed of the replevin case, the applicable re%le$entar' period for appeal as fifteen 21-4 da's fro$ BA &inance?sreceipt of a cop' of that order. 8he Court of Appeals concluded that petitioner?s notice of appeal had not been

seasonabl' filed.

8hus, this Petition for Revie.

8o 24 issues are raised here< the first relates to the character of the order of the trial court dated >anuar' 193*/ thesecond concerns the re%le$entar' period applicable in respect of an appeal fro$ that order of the trial court.

1. 8he principal case filed b' BA &inance a%ainst Dan6' as, e alread' noted, for replevin, and inthe alternative, collection of the a$ount of the loans, plus interest, oed b' Dan6' to BA &inance.5ections 9 and 1! of Rule *! on =eliver' of Personal Propert',= of the Revised Rules of Court statethat<

5EC. 9. >ud%$ent. After a trial of the issues the court shall find in (hom is the right of possession andthe value of the propert) and shall render udgment in the alternative for the deliver)thereof to the part) entitled to the same , or for the value in case deliver) cannot be made, and also forsuch da$a%es as either part' $a' prove, and for costs.

5EC. 1!. Judgment to include recover) against sureties. 2he amount, if an), to be a(arded to

either part) upon an) bond filed b) the other in accordance (ith the provisions of this rule, shall beclai$ed, ascertained, and %ranted under the sa$e procedure as prescribed in section ! of Rule -.2E$phasis supplied4

8he >anuar' 193* order of the trial court $erel' directed BA &inance to turn over to ;ilson 5i', as hi%hest bidderin the public sale, properties hich had alle%edl' been sold at a public auction but hich had supposedl' re$ainedundelivered to the latter. 8hat order never passed upon the ri%ht of either of the ori%inal parties, BA &inance or Dan6'7ardare, to ta6e or 6eep possession of the replevied ite$s. 8hat order, $oreover, did not resolve a clai$ b' BA&inance that not all the $ovables $ort%a%ed under the chattel $ort%a%e had in fact been replevied b' the sheriff fro$Dan6'?s pre$ises. Neither did that order deter$ine hether BA &inance as entitled to collect P--9,-*-.!! as loans

due and pa'able fro$ Dan6' and suret' Antonio N%ui De6 5ie$. ;e thin6 it clear that hat had been issued b' thetrial court on >anuar' 193* as not a :ud%$ent hich disposed of the causes of action pleaded b' BA &inance orthe defenses raised b' Dan6' and suret' Antonio N%ui De6 5ie$. Rather, that order resolved hat as initiall' $erel'

an incident of the principal case but hich, under the Court of Appeals? decision, threatens to overhel$ the parties tothe ori%inal suit.

+t $ust be recalled that Dan6'?s creditor ban6s had intervened in the replevin case and that upon the su%%estion of oneof the ban6s, the chattels sub:ect $atter of the replevin suit ere sold to avoid further deterioration of value pendin%resolution of the $ain case. Respondent ;ilson 5i' as neither an ori%inal part' nor an intervenor in the replevincase/ he as a total stran%er visavis the ori%inal parties and the intervenors. Nonetheless, e $ust reco%ni"e that the >anuar' 193* order of the trial court purported to resolve the ri%ht of ;ilson 5i' to receive the disputed $ovable

properties and accordin%l' BA &inance?s obli%ation to deliver to 5i' those sa$e properties/ to this li$ited e#tent, i.e.,so far as concerns the dispute beteen BA &inance and ;ilson 5i', the trial court?s order as clearl' a final one.



+t is a fir$l' settled rule that onl' a final order or :ud%$ent on the $erits $a' be the sub:ect of an appeal. A :ud%$enton the $erits is one rendered after a deter$ination of hich part' is in the ri%ht and $ust prevail, as distin%uishedfro$ a :ud%$ent rendered upon so$e preli$inar' or for$al or $erel' technical point. 1! +n other ords, after a final

order or :ud%$ent, the court should have nothin% $ore to do in respect of the relative ri%hts of the parties to the case.Conversel', =an order that does not finall' dispose of the case and does not end the Court?s tas6 of ad:udicatin% theparties? contentions in deter$inin% their ri%hts and liabilities as re%ards each other, but obviousl' indicates that otherthin%s re$ain to be done b' the Court, is interlocutor'.= 1

. 8he second issue to be resolved is< hat as the applicable re%le$entar' period for appealin% the >anuar' 193* order of the trial court to the Court of Appeals

8o 24 re%le$entar' periods for perfectin% appeals ere established b' the +nteri$ Rules and Fuidelinespro$ul%ated b' the 5upre$e Court on << Januar) <=> for the i$ple$entation of the >udiciall' Reor%ani"ation Actof 1931 2B.P. Bl%. 194, 5ection 19 of hich provides as follos<

5ection 19. &eriod on Appeals.?

2a4 All appeals, e#cept in habeas corpus cases and in the cases referred to in para%raph hereof, $ustbe ta6en ithin fifteen 21-4 da's fro$ notice of the :ud%$ent, order, resolution or aard appealedfro$.

2b4 +n appeals in special proceedin%s in accordance ith Rule 1!9 of the Rules of Court and othercases herein $ultiple appeals are alloed, the period of appeals shall be thirt' 2)!4 da's, a recordof? appeal bein% re0uired.=

@nder the above0uoted section, the re%le$entar' period to appeal is, not fifteen 21 -4 da's, but rather thirt' 2)!4 da'sin< 214 appeals in special proceedin%s/ and 24 =other cases herein $ultiple appeals are alloed.= +n the instant case,as alread' pointed out, the 0uestioned order finall' disposed of the incident involvin% BA &inance and ;ilson 5i' andhis clai$ to certain chattels stored in BA &inance?s arehouse, but not the $ain action itself beteen BA &inance,Dan6' 7ardare and the intervenor ban6s. 8he principal action itself has not 'et reached the trial sta%e, hich trialould relate not to the chattels that ere disposed of or alle%edl' disposed of b' public sale but rather to the

disposition of the proceeds 2or hatever proceeds are properl' due fro$ ;ilson 5i' of such sale, and to the alternativede$and for pa'$ent of the outstandin% obli%ations of Dan6' 7ardare to BA &inance. ;e believe and so hold that%iven the actual circu$stances of the instant case, it $ust be re%arded as fallin% ithin the ter$ other cases herein$ultiple appeals are alloed=. +t follos that the applicable period for appeal is thirt' 2)!4 da's, the record on appealbein% re0uired since the e#pediente of the case $ust re$ain ith the trial court so that the case $a' proceed to trial on

the $erits of the clai$s beteen the principal parties and the intervenors.

;e note also that prima facie, to prevent BA &inance fro$ appelin% the order of the trial court dated >anuar' 193*$a' result in a serious $iscarria%e of :ustice. Private respodent ;ilson 5i' sub$itted a bid for and paid the a$ount ofP7,777.77 hich he presu$abl' felt as the reasonable value of the personal properties sub:ected to the public sale.8he 0uestioned order of the trial court re0uires BA &inance to deliver to 5i' as vendee in the public sale chattels iththe total esti$ated value of P@. million hich represents a trul' e#traordinar' rate of return of ),3!! percent on

;ilson 5i'?s ori%inal invest$ent. 8his circu$stance b' itself su%%ests that so$ehere a serious $ista6e of fact, or aneccentric interpretation of the ter$s of the chattel $ort%a%e contract or possibl' even deliberate fraud $a' havevitiated the proceedin%s belo concernin% ;ilson 5i'?s clai$s, to the obvious pre:udice of BA &inance, or Dan6'7ardare and suret' Antonio N%ui De6 5ie$, or the intervenor ban6s, or so$e or all of these. E0uitableconsiderations thus support the conclusion reached above.

+n the interest of orderl' procedure, ;ilson 5i' should not have been alloed b' the trial court to intro:ect hi$self inthe principal case b' the filin% of a $otion for deliver' of chattels alle%edl' sold but undelivered to hi$ b' BA&inance at public auction. 7is proper recourse as to institute an independent suit a%ainst the sheriff and BA &inance.As it is, the de facto intervention of ;ilson 5i' in the proceedin%s beteen BA &inance and Dan6' 7ardare and theintervenor ban6s has alread' resulted in undue dela' in such proceedin%s.

;7ERE&ORE, the Petition for Revie on certiorari is hereb' FRAN8E and the ecision of the Court of Appealsdated )! April 193 and the Orders of the trial court dated >une 193* and 1* >ul' 193*, are hereb' REJER5E and5E8 A5+E. 8he trial court is hereb' +REC8E to approve the notice of appeal and the record on appeal filed b'petitioner. Costs a%ainst private respondent.

5O ORERE.



"ernan, C.J., Bidin and Cortes, JJ., concur

Gutierre0, Jr., J., is on leave

"oo0)o0#

1 Record, pp. -*-9.

*bid, pp. *!*1.

) *bid, pp. **3.

( *bid, pp. 1*1.

- *bid , p. ).

* Rollo, Anne# =A= of Petition, p. )1.

*bid, Anne# =E= of petition, p. (9/ e$phasis supplied.

3 Record, pp. 1!11!.

9 *bid, pp. 1!)1!-.

1! Record, pp. 1*9.11 *bid, p.-.

1 *bid, pp. *)*(.

1) Rollo, Anne# =A= of Petition, pp. 9)).

1( 5antos v. +AC, 1(- 5CRA )3 2193*4/ e Oca$po v. Republic, 9 5CRA ((! 219*)4.

1- +nvest$ent, +nc. v. Court of Appeals, 1( 5CRA ))( at )(! 21934. 5ee also Antonio v. 5a$onte,1 5CRA 1! 219*14/ Qapisanan n% $%a Man%%a%aa sa MRR v. Dard Cre @nion, 1!9 Phil. 11()219*!4/ P8 E$plo'ees @nion v. P8 Co. &ree 8elephone ;or6ers @nion, 9 Phil. (( 219--4/7od%es v. Jillanueva, 9! Phil. -- 219-14/ Nico v. Blanco, 31 Phil. 1) 219(34/ Rios v. Rios, 9 Phil.() 219(4.

Date post:	04-Jun-2018
Category:	Documents
Upload:	attygempammit
View:	215 times
Download:	0 times

Replevin jurisprudence.doc

Documents